Changing Class

Are colleges helping Americans move up?

Katherine Zhou for APM Reports

Colleges have long offered a pathway to success for just about anyone. But new research shows that with the country growing ever more economically divided, colleges are not doing enough to help students from poor families achieve the American Dream.

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Changing Class: Are Colleges Helping Americans Move Up?

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August 20, 2018 | by Sasha Aslanian and Emily Hanford

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Patrick Hughes has a quintessentially American story. The son of Jamaican immigrants, he was raised in a lower-middle-class section of Queens, New York. His parents, particularly his mother, urged him to go to college.

For decades, millions of poor Americans have told their children something similar: that the way to make more money, and get ahead in life, was to attend college. There's plenty of data that it was sound advice. People with bachelor's degrees earn 84 percent more over a lifetime than people with just high school diplomas. And if you don't have a degree, you're about twice as likely to be unemployed and more than three times as likely to live in poverty. But it's not all about money. People with college degrees tend to be healthier, they're more likely to vote and to volunteer, and their kids are more likely to go to college, too.

"Education is the path to break the cycle that my parents were fighting so hard to break," Hughes said. He ended up attending Stony Brook University on Long Island, a public university with a history of helping kids from poor backgrounds get ahead. It worked for Hughes. As he neared graduation this past spring with a major in information systems, he began looking for a tech job. He'd been dreaming of a job in the field ever since he was 12, when he'd started taking apart his mom's computer and putting it back together.

Patrick Hughes of Queens, New York, was part of a program at Stony Brook University geared to low-income students with high potential.Sasha Aslanian | APM Reports

Before long Hughes had a handful of job offers. He was holding out hope for a position with Google, though the odds were against him; the tech giant receives more than a million applicants a year. But the wait proved worth it when Google offered him a job at its office in Austin, Texas. He started work there in July. The story of the Jamaican kid from Queens going off to Google represents the kind of bottom-to-top social mobility that Americans often romanticize.

But it's a story that's becoming increasingly rare at colleges across the country. Recent academic research suggests that chances for students from poor families in America to move up through higher education are shrinking. Elite colleges still don't admit many students from poor backgrounds, and public universities are under increasing financial pressure to enroll wealthier students who can afford full tuition. Students from poor families are being shut of the best opportunity they have to move up.

That trend is happening at a time when social mobility in America is stagnating. The chances an American child will earn more than his or her parents has been declining: Children born in the 1940s had a 90 percent chance of surpassing their parents; kids born in 1980 had only a 50 percent chance of doing better. It's now more difficult to break out of the class you're born into. Children of well-to-do families are likely to stay that way, and children of poor families are likely to stay poor.

As John Friedman, an economics professor at Brown University and one of the leading researchers on a project about stagnating social mobility, put it, "I think that's led to a real feeling for many across America that the American Dream is slipping away from them."

The rich were getting richer, and the poor were getting poorer

For the poorest third of children, family incomes declined between 1975 and 2011.

SOURCE: The Hamilton Project at the Brookings Institution

Stalled social mobility

Five years ago, Friedman and a group of fellow academic economists set out to investigate the role higher education is playing in America's stalled social mobility. The Equality of Opportunity Project, led by Friedman and Raj Chetty and Nathaniel Hendren at Harvard University, pulled de-identified data from the Internal Revenue Service and U.S. Department of Education on 30 million people who attended college between 1999 and 2013. They traced where students had grown up and how much their families earned. Then they looked at whether the students went to college and where they went. Finally, researchers measured the students' individual or household earnings in their mid-30s.

IN THEIR OWN WORDS

We asked listeners to tell us about their experiences with college and social mobility. Read their stories.

The economists wanted to know which colleges were producing the most bottom-to-top success stories and which ones were not. They defined mobility as the percentage of all students who went from the bottom fifth of the income distribution to the top.

In their data, that means going from a family income of less than $20,000 a year to an annual family income of at least $110,000. In other words, what many people might consider the American Dream. Over the past few decades, fewer and fewer young Americans are making that leap.

Perhaps unsurprisingly, the economists found that the nation's most elite colleges are the schools best positioned to boost low-income students into the elite echelons of society. Students from poor families who go to these schools have a 50 percent chance or better of becoming top earners. But those elite colleges are admitting very few people from poor families. In fact, 38 top colleges had more students from the top 1 percent of earners than the bottom 60 percent.

And one school in particular stood out. Washington University in St. Louis had the highest median family income of any elite university in the country: $272,000 a year.

Students admitted by parents' income quintile

SOURCE: The Equality of Opportunity Project

A commuter school that made it big

At highly selective private colleges like Washington University there are almost no students from poor families. In the Equality of Opportunity Project data, Washington University ranked last among elite colleges for its percentage of students from poor families: Less than 1 percent of Washington University students came from families among the bottom fifth of the income distribution.

So how did Washington University become a school for rich kids?

It didn't start out this way. When it first opened its doors in 1854, the school offered free night classes to mostly immigrant men.

"At the beginning, Washington University was a school that was kind of hanging on by its fingernails," said Candace O'Connor, who wrote a history of Washington University. The university later grew into a place that educated the children of local elites so they didn't have to go East for college, but it also welcomed talented students of lesser means.

One of O'Connor's favorite stories is about a scholarship request that was so original it became part of the university's lore and hung on the wall in the admissions office for years. In the late 1940s, a young man from a hardscrabble farm in the Missouri Ozarks wrote to say he had four cows and proposed selling one each year to cover his expenses, but he would still need a scholarship to close the gap. The university agreed. The student, George Bauer, went on to a career with IBM and later as an investment banker. He's given millions to Washington University.

By the 1950s, Washington University was still mostly a commuter school, a "streetcar college." But the administration had ambitions to turn the school into an elite institution and draw more students from out of state. Its rise from commuter school to elite university is a good primer for how poor kids have increasingly been shut out in recent decades.

"Nobody set out to do this. Nobody said, 'Let's make colleges more unequal,'" said Charles Clotfelter, an economist at Duke University and the author of Unequal Colleges in the Age of Disparity. "But in fact, that's exactly what happened." He said that around 1980, income inequality began to rise in the United States. Wages for most Americans stagnated while the rich got richer, and colleges mirrored that divide. Rich families could pay more tuition. Their alumni made big donations. Their endowments rode the bull market.

There was another new force at work in the 1980s that would magnify the divide: college rankings. In 1983, U.S. News and World Report began publishing its annual best colleges in America issue. The rankings were an overnight success. They were a shortcut for parents trying to make sense of the college market.

The rankings skewed toward rich-kid schools. For example, the rankings favored schools that had incoming classes with high SAT and ACT scores. But test scores are highly correlated with family income. Students whose family incomes are more than $200,000 a year score hundreds of points higher on SATs on average than students who come from families making less than $20,000 a year.

Moreover, affluent families could afford full tuition that helped pay for new buildings, top faculty and impressive programs — all of which help a school move up in the rankings. So high rankings bring in rich kids, and rich kids improve a school's rankings.

In 1988, Washington University debuted at number 23 in the U.S. News college rankings.

Mark Wrighton served as chancellor for Washington University in St. Louis from 1995 to 2018 and led the institution to greater national prominence, wealth and selectivity.Sasha Aslanian | APM Reports

By 1995, it had moved up to 20th place, and the university was looking for a new chancellor. The leading candidate was Mark Wrighton, a chemist who had risen to become provost of MIT. Wrighton saw great potential at Washington University.

"I discovered that Washington University was a lot better than people knew," Wrighton said. "And I thought if I could win the job, it would be relatively easy, because I felt that it would be a great place for very talented people." Wrighton was hired, and he set out to accelerate the school's ascent. Tuition was ticking up each year by a small percentage as it was at other private colleges, and construction cranes became a fixture on campus as the university added and renovated buildings.

By 2003, Washington University cracked the U.S. News Top 10. Then came the crowning moment. The New York Times wrote a glowing piece about Washington University, marveling at the school's rapid climb in the rankings and noting its fundraising prowess. Washington University had made it.

Where are the poor students?

A decade later, in 2013, Washington University was the subject of another, far less flattering New York Times story. "Elite Colleges Differ on How They Aid Poor," read the headline in the front-page article. The story highlighted the paltry number of low-income students at elite schools and pointed to Washington University as a prime example. The Times used the percentage of students on federal Pell grants as a proxy for low-income. At that time, most students who got Pell grants were from families who made less than $30,000 a year. Only 7 percent of Washington University's students received Pell grants. Some of Washington University's peer institutions, like Vassar, Amherst and Emory University, had triple that percentage.

High school senior Delton Utsey, center, received a graduation cord from chancellor Mark Wrighton, left, and associate vice chancellor Leah Merrifield, right, April 22, 2018, at a ceremony for Washington University's College Prep Program. The three-year program helps low-income high school students from the St. Louis area prepare for college. Utsey entered Washington University as a freshman this fall.Sasha Aslanian | APM Reports

Leah Merrifield, an associate vice chancellor at Washington University, remembers the fallout from the bad press. "Your phone was ringing, your email was blowing up. Text messages from colleagues all over the country saying, 'Did you read?!' You are like the 100th person. Yes, you know, I read it."

The criticism wasn't just from the outside. People inside the school were upset, too. A letter calling for greater economic diversity in the student body was signed by 142 faculty members.

A student group called Washington University for Undergraduate Socioeconomic Diversity ran a photo campaign on social media naming what students would give up: tulips on campus, catered meals at the business school, Tempur-Pedic mattresses in the dorms and petting zoos during finals week.

Merrifield said that to its credit, Washington University didn't try to bury the problem. "Institutionally we made decisions that resulted in a certain outcome, and if you accept the praise, you gotta accept the criticism, and a lot of it was valid," she said. "To me the important piece was the response. Instead of saying, 'Oh no, you misread the statistics, it wasn't really like that,' instead of going that route, we owned up to it. We said, 'You're right, you know. That's what we did. Thank you for giving us that feedback, and institutionally, we're going to start doing things differently.'"

Provost Holden Thorp was new on the job when the firestorm hit. "My first reaction was 'Well, if we're going to work on this, I guess I came to the right place,'" he said.

Thorp had previously been the chancellor at the University of North Carolina at Chapel Hill and had worked on trying to get more low-income students into the state's flagship university. "It was always in the plans of Washington University to build our financial aid endowment, and that accelerated it," he said.

In 2015, Washington University announced a goal to double the number of its students who were poor enough to qualify for federal Pell grants — from 7 percent to at least 13 percent.

When poor kids get in, they prosper

For researchers at the Equality of Opportunity Project, elite universities' small number of students from poor backgrounds is especially troubling because of a striking finding in their data: When students from poor families get a chance to attend an elite college like Washington University, they excel. More than half the students from poor families who go to Washington University end up in the top 20 percent of earners.

"So what we find in the data is that the students from poorer backgrounds who attend elite schools do essentially as well as students that attend those same schools from much, much richer backgrounds," Friedman said. "That is despite the very strong dependency in this country of kids' outcomes to parents' incomes in general. That almost entirely disappears once you look at students at an individual college."

That's a powerful potential counterforce to America's stalled social mobility. And that's why the Equality of Opportunity Project researchers make a big deal out of elite schools. Top colleges have the power to propel students from poor families way up the earnings ladder. But students have to get the chance. Several reports and studies show there are many highly qualified students from low-income families — maybe tens of thousands of such students — who could succeed at highly selective colleges.

At top colleges, there's a debate over how best to admit students from poor families. Some really wealthy colleges — such as Ivy League schools and a few others — read applications without looking at whether the student is also applying for financial aid. This is called "need blind admissions." These schools pick the best students regardless of their ability to pay, and the school covers whatever the student can't afford. This is generally a good way to admit more people from poor backgrounds, but only a few schools can afford that approach. They tend to be some of the wealthiest schools, with huge endowments.

Washington University uses a process called "need aware," which means when staff read applications, they do look to see who's asking for financial aid. There's a pot of money for financial aid and once it's gone, it's gone. Thorp says if an applicant needs aid and Washington University can't provide it, the university doesn't accept that student.

"We have only admitted students historically if we could meet all their financial need, and we're just expanding the number of students that we're doing that for," Thorp said.

For the past three years, Washington University has met its goal of an incoming class in which students from poorer backgrounds make up at least 13 percent of the student body. The school is now closer to the middle of the pack among selective schools. It's spending millions more on financial aid each year, and it's also invested in more campus support for low-income and first-generation students.

Ruth Durrell is a sophomore from Milwaukee, Wisconsin, and an Ervin Scholar at Washington University in St. Louis. She mentors students in Deneb STARS, a new program Washington University created to better serve first-generation and low-income students.Sasha Aslanian | APM Reports

For example, two years ago, the university launched a program called Deneb STARS, named for one of the most distant stars that can be seen with the naked eye. Students in the program have their own space in an elegant building with windows opening out onto central campus. They gather here to study, get tutoring, eat snacks and hang out.

But helping low-income students feel comfortable at an elite school is one thing. Getting them to apply is another. Research shows there are many low-income students who could qualify for selective schools, but most high-achieving students from poor families don't apply to any selective colleges. When she was in high school in Chicago, Gabby Pantoja, a junior at Washington University, was part of a program called Target H.O.P.E. that helps black and Latino youth prepare for college. It gave her the chance to visit the school the summer after 10th grade. As soon as she stepped on campus, she knew it was where she wanted to go. Washington University has expanded partnerships with community organizations that identify promising students like Gabby and help them navigate the college admissions process.

Washington University has demonstrated that elite schools can crack the door open wider to students from poor families. But even with these efforts, Washington University and its peer institutions haven't been doing much to promote large-scale social mobility in this country.

The economists at the Equality of Opportunity Project did find some colleges that were.

A mobility maker

There are some public universities, according to the Equality of Opportunity Project data, that have been taking in numerous low-income students and propelling them up the earnings ladder. "If you look at the schools with the very highest mobility rates, they are primarily schools that are in the middle of the American public higher education system," Friedman said.

Stony Brook University was one school that caught the researchers' attention. Eleven percent of its students came from the poorest 20 percent of households. Half of them went on to become top earners. That's an Ivy League success rate.

Students admitted by parents' income quintile

SOURCE: The Equality of Opportunity Project

Stony Brook was the best mobility maker of highly selective public colleges in the nation. Other top public colleges were doing well with their low-income students, too. The problem: There were very few such students to begin with at many top public institutions. For example, at the University of Michigan, which had the highest median income among highly selective public colleges, less than 3 percent of students came from the bottom fifth of the income distribution. If you have almost no low-income students, you can't possibly be doing much to promote social mobility.

Stony Brook has been boosting kids like Patrick Hughes, who grew up in Queens and ended up at Google, for decades. The school is a short train ride away for many talented, low-income students growing up on Long Island and in New York City. These students are hungry to succeed, and Stony Brook sees helping them do that as part of its mission. It recruits them, it gives them a chance even if they may not be quite ready for college, and it supports them along the way.

Judy Berhannan, Stony Brook's dean of admissions, has been at the school for 34 years, more than half its history. Over the years, she's picked a lot of the students who have become bottom-to-top success stories, like Hughes, and she knows how many more want the chance. "I see family income levels so I see the level of need, and in my opinion, it's grown over the years," she said.

Thirty-two percent of Stony Brook undergraduates receive Pell grants. And because of federal, state and institutional financial aid, close to half of Stony Brook students pay no tuition. But it can still be a stretch to afford things like housing and books. Berhannan says there's a culture at Stony Brook of trying to make college possible for low-income students — for example, waiving a housing deposit or allowing someone who doesn't have a place to live for the last two weeks of summer to move in early.

Social mobility doesn't happen just because a school takes in students from poor families. Plenty of schools are willing to take their students' money, but many of those schools don't catapult their students to higher incomes. For example, many for-profit schools take a lot of low-income students but have some of the worst success rates.

There's something that Stony Brook is doing for its low-income students that's really working. Some students are admitted through the Educational Opportunity Program, which takes low-income students who are academically underprepared but show strong potential to do well at Stony Brook. Three thousand people apply for these coveted spots every year, but only about 200 get them. It's a state-funded program, so there's only so much money.

First-year students arrive five weeks early for an intensive summer school session, and they're matched with counselors who work with them from the beginning to the end of their college careers. Throughout the school year, students in the program get academic and social support from counselors and peer mentors. The support seems to be paying off. The average graduation rate of students in the EOP program is higher than the graduation rate for the rest of the student body.

Hughes was one of the students who went through EOP and prospered. But as he neared graduation and faced a decision of what he would do next, he was dealing with pressures that his wealthier peers didn't have to contend with. His whole family was counting on his financial success. Recently, Hughes visited relatives in Jamaica, and before he left, his grandfather told him he was broke. Hughes gave his grandfather everything he had in his wallet.

"Some people can afford the luxury to say like, 'Oh, I got a 70K job, I can put my feet up, all this is mine.' But I know that I've got about 10 mouths to kind of like divvy up and that sort of thing," Hughes said.

Stony Brook University senior Patrick Hughes, left, meets with one of his mentees, Elvis Perez, a first-year student. The Equality of Opportunity Program provides low-income students with one-on-one peer mentoring and other academic and social support. EOP students have a higher graduation rate at Stony Brook than the general student population.Sasha Aslanian | APM Reports

Dealing with funding cuts

Stony Brook had modest beginnings as a teachers college in 1957. Over the decades, it's maintained a commitment to helping students from low-income backgrounds move up.

But the school is facing financial pressures that threaten the future of that commitment. The Equality of Opportunity Project found that Stony Brook admitted significantly more students from high-income families in 2011 than it had in 2000. The share of students from the top 20 percent of households grew from 33 percent to 40 percent over that period. At the same time, students from the poorest households shrank from 17 percent to 11 percent of the student body.

The reason for this shift was largely due to cuts in state funding following the 2008 economic crash. That made Stony Brook and other public universities more reliant on tuition dollars. Since Stony Brook can't raise tuition without legislative approval, it has turned to international and out-of-state students who pay tuition that's four times higher than what New Yorkers pay.

Stony Brook is dealing with a financial squeeze that's affecting a lot of other public institutions, too. A report by the State Higher Education Executive Officers Association found more than half of all state colleges and universities now rely more on tuition than on state and local government funding. In 44 states, funding fell after the recession hit, and it hasn't come back.

"We want to remain committed to the social mobility we're doing, but we're really getting squeezed," said Stony Brook President Samuel Stanley. "You know, the incentives that have been created for us are to accept more students who pay full out-of-state or international tuition."

A fifth of Stony Brook students now come from out of state, and this fall, there will be fewer slots for entering students in the Educational Opportunity Program that Patrick Hughes was in because it's at capacity.

Hughes wonders what could be accomplished if more low-income students got a chance like he did. "We're going to change our communities, but if you're only letting a few of us in, that change is going to happen very slowly."

Support for this program comes from Lumina Foundation and the Spencer Foundation.

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